Fund Types

Funds are, more or less, divided into money market, bond, stock, commodity and balanced (hybrid) funds depending on the asset types primarily serving as the target of the investment.

Investment Scope and Features of Each Type

Money Market Funds

Investment Scope

Money market funds mainly invest in short-term monetary instruments, such as bank deposits, certificates of deposit, short-term government bonds, treasury bonds, commercial papers, corporate bonds and other highly secure short-term securities with stable returns.

Features

These are suitable for investors with low risk appetites or for managing short-term idle liquidity

Security: lower risk relative to other types of funds.

Profitability: lower profit relative to other types of funds.

Liquidity: short subscription and redemption times, which are convenient for managing funds.

Bond Funds

Investment Scope

Bond funds primarily invest in bonds, such as government bonds, financial bonds, corporate bonds and other fixed-income products or debt products. Some bond funds may allocate a small amount of stocks.

Features

Generally speaking, the risk is higher than that of money market funds, but lower than other types of funds. The returns are moderate, but there are fluctuations.

Stock Funds

Investment Scope

Stock funds mainly invest in stocks. This can be subdivided into multiple dimensions based on the range of stocks invested in, such as thematic stock funds which invest in a certain country, or thematic funds which invest in stocks in a certain industry or stocks of a certain style (value, growth, etc.).

Features

High volatility, high risk; potential gains and losses are much higher than money market and bond funds.

Commodity Funds

Investment Scope

Fund varieties with bulk commodities serving as the main investment targets include but are not limited to: listed commodity companies, commodity spot and futures, and so forth. Common commodity types include: precious metals such as gold and silver, crude oil, agricultural products and so forth.

Features

Risks are higher and returns are related to commodity price movements.

Balanced Funds (Hybrid Funds)

Investment Scope

The scope of investment is flexible and can be invested in a variety of financial products, such as stocks, bonds and money market instruments.

Features

High flexibility.

Note: There are risks in the market, and investors need to be cautious. The above information is provided only for users to understand the possible features of these types of funds, and is not intended as investment advice. Before making any investment decisions, investors should carefully read the information and related documents provided by the fund manager and fund products to assess whether they are suited to invest in such funds, as well as their ability to withstand risks.